Working Paper
Modeling the Consumption Response to the CARES Act
Carroll, Christopher D.; White, Matthew N.; Crawley, Edmund S.; Slacalek, Jiri (2020-08-31)
To predict the effects of the 2020 U.S. CARES act on consumption, we extend a model that matches responses of households to past consumption stimulus packages. The extension allows us to account for two novel features of the coronavirus crisis. First, during the lockdown, many types of spending are undesirable or impossible. Second, some of the jobs that disappear during the lockdown will not reappear when it is lifted. We estimate that, if the lockdown is short-lived, the combination of expanded unemployment insurance benefits and stimulus payments should be sufficient to allow a swift ...
Finance and Economics Discussion Series , Paper 2020-077

Working Paper
Welfare and Spending Effects of Consumption Stimulus Policies
Carroll, Christopher D.; Tretvoll, Håkon; Crawley, Edmund (2023-01)
Using a heterogeneous agent model calibrated to match measured spending dynamics over four years following an income shock (Fagereng, Holm, and Natvik (2021)), we assess the effectiveness of three fiscal stimulus policies employed during recent recessions. Unemployment insurance (UI) extensions are the clear “bang for the buck” winner, especially when effectiveness is measured in utility terms. Stimulus checks are second best and have the advantage (over UI) of being scalable to any desired size. A temporary (two-year) cut in the rate of wage taxation is considerably less effective than ...
Finance and Economics Discussion Series , Paper 2023-002

Working Paper
The nature and magnitude of precautionary wealth
Samwick, Andrew A.; Carroll, Christopher D. (1992)
Working Paper Series / Economic Activity Section , Paper 124

Working Paper
Saving and growth with habit formation
Carroll, Christopher D.; Overland, Jody; Weil, David N. (1995)
Finance and Economics Discussion Series , Paper 95-42

Working Paper
How does future income affect current consumption?
Carroll, Christopher D. (1992)
Working Paper Series / Economic Activity Section , Paper 126

Working Paper
On the concavity of the consumption function
Kimball, Miles S.; Carroll, Christopher D. (1995)
Finance and Economics Discussion Series , Paper 95-10

Working Paper
Does consumer sentiment affect household spending? If so why?
Carroll, Christopher D.; Wilcox, David W.; Fuhrer, Jeffrey C. (1991)
Finance and Economics Discussion Series , Paper 168

Working Paper
How important is precautionary saving?
Samwick, Andrew A.; Carroll, Christopher D. (1993)
Working Paper Series / Economic Activity Section , Paper 145

Working Paper
Saving and growth: a reinterpretation
Carroll, Christopher D.; Weil, David N. (1993)
Working Paper Series / Economic Activity Section , Paper 140

Working Paper
Unemployment risk and precautionary wealth: evidence from households' balance sheets
Carroll, Christopher D.; Dynan, Karen E.; Krane, Spencer D. (1999)
Recent empirical work on the strength of precautionary saving has yielded widely varying conclusions. The mixed findings may reflect a number of difficulties in proxying uncertainty, executing instrumental variables estimation, and incorporating theoretical restrictions into empirical models. For each of these problems, this paper uses existing best-practice techniques and some new strategies to relate unemployment probabilities from the Current Population Survey to net worth data from the Survey of Consumer Finances. We find that increases in unemployment risk do not boost saving by ...
Finance and Economics Discussion Series , Paper 1999-15